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SBD/February 15, 2011/Marketing and SponsorshipPrint All
The NBA and Coca-Cola Co. today announced a multiyear extension of their global marketing partnership that dates back to '86. The Sprite brand, which has been the official soft drink of the NBA in the U.S. since '94, now will be Coca-Cola's lead brand associated with the league globally. Sprite will continue its sponsorship of the NBA Slam Dunk contest and also will conduct a variety of NBA-themed activities, including events, digital promotions and grassroots programs. The brand also will continue to present the Sprite Slam Dunk Showdown, a contest to find the best amateur dunker in North America (NBA). In Atlanta, Jeremiah McWilliams reports the extended deal runs through '14. Previously, Sprite "headlined the partnership in some markets and the Coca-Cola brand did so in others, most notably China." Sprite is "riding a winning streak" as of late. The brand recently posted its "third consecutive quarter of growth in North America, with sales rising four percent in the fourth quarter and two percent for the full year." The NBA, FIFA World Cup and the Olympics are the only three global deals for Coca-Cola Co. (ATLANTA CONSTITUTION, 2/15).
NASCAR has signed a licensing agreement with Wal-Mart that will enable the world's largest retailer to source apparel, home goods and other products bearing NASCAR, driver and team imagery and marks. The deal, which is expected to be announced soon, is Wal-Mart's first licensing agreement with a major sports property. A direct license from NASCAR gives Wal-Mart the ability to select suppliers and negotiate prices for hats, T-shirts and other NASCAR-related merchandise. NASCAR and Wal-Mart agreed to a three-year deal with options for an extension. Wal-Mart will pay a licensing royalty, but terms of that royalty were not available. The deal was struck by NASCAR Team Properties. NASCAR VP/Licensing & Consumer Products Blake Davidson said, "It's a significant step for us and the industry to take. Any sport doing deals directly with a retailer at this level with this breadth of size and scope is not common." Wal-Mart plans to support its licensing agreement over the next two weeks with a special "Race Time" promotion that begins today in more than 1,500 stores nationwide. The "Race Time" promotion will feature nearly a dozen of NASCAR's sponsors such as Coca-Cola, Mars and MillerCoors in a specially branded area of the store. Davidson said, "It's the largest retail promotion we've done." Wal-Mart also plans to run a "Chase the Race" program in race markets. It will set up a race simulator and activation area where sponsors can engage with fans in its store parking lots. The program will visit multiple stores in a market in the days preceding a race.
IN THE WORKS FOR A WHILE: The Wal-Mart deal is the result of a year of negotiations between NASCAR and the retailer. It is the third deal negotiated by the NASCAR Teams Licensing Trust. The trust previously negotiated licenses with Motorsports Authentics for trackside retail and Lionel for diecast cars. During the course of negotiations, Wal-Mart also reportedly looked at sponsoring Jeff Gordon's No. 24 car. The company pulled back from that opportunity last September to reassess its marketing plans in the sport. In addition to NASCAR-related retail promotions, it signed on to be presenting sponsor of Speed’s “Trackside” show, which premiered at Daytona in '04. The show will be hosted Friday night from the Speed stage at Daytona Int'l Speedway.
The NFL "has restructured its lucrative licensing and sponsorship contract with Electronic Arts to account for the sport's uncertain future, significantly reducing the video game maker's contractual obligations next season but adding a year to the deal," according to sources cited by Daniel Kaplan of SPORTSBUSINESS JOURNAL. The contract now runs through '13. The league is "believed to have so far rebuffed pleas for fee reductions from other licensees and sponsors, many of which, like EA, find it difficult planning for the next season under the threat of a work stoppage." However, EA is a "special case, with its iconic 'Madden' video game title." The licensing deal it agreed to with the NFL in early '08 is "believed to be worth well into nine figures in guarantees and royalties over its original five-year term." Jaguars Owner Wayne Weaver, who serves as Chair of the NFL's Business Ventures Committee, said, "For one of our core partners in a difficult environment, we say let's look at this, and maybe it makes some sense to extend something out longer and give our partner some relief in the short term but gain something on the back end." Both Weaver and the sources "declined to say how much relief EA is gaining" (SPORTSBUSINESS JOURNAL, 2/14 issue).
Erin Andrews is "not the only ESPN personality" or member of its "College GameDay" team with a shoe sponsorship, as Chris Fowler, Lee Corso and Kirk Herbstreit all "have deals with Nike," according to Richard Sandomir of the N.Y. TIMES. Corso described the Nike relationship as a "joint arrangement that largely involves speaking engagements for the athletic shoe and apparel company." While Andrews and Reebok announced their partnership last month, Fowler, Corso and Herbstreit's deals with Nike "were never announced." ESPN VP/PR Josh Krulewitz said, "We were unaware of these deals." Krulewitz added Fowler is ending his association with Nike "to avoid any potential perception issues." But Corso contends that "his obligations to Nike were not burdensome and did not compromise his work." He said, "I might have Nike shoes on, but it’s got nothing to do with ‘College GameDay.'" Still, DePauw Univ.'s Prindle Institute for Ethics Dir Bob Steele believes that Nike’s tie to the "GameDay" announcers "creates potential conflicts of interest." ESPN noted that "it allowed reporters and personalities to sign endorsement deals on a case-by-case basis." Krulewitz said it is "common" for former players and coaches like Herbstreit and Corso to have endorsement deals after they become analysts. Sandomir notes ESPN "approved Andrews’s deal with Reebok while saying it would inform the audience if a conflict arises between her commercial and reporting roles." But last year, ESPN blocked college football reporter Jenn Brown from endorsing MillerCoors' Icehouse brand (N.Y. TIMES, 2/15).
The NBA is “introducing a social video game on Facebook this week” called "NBA Legend," which allows users to “create an avatar, join an NBA basketball team, and follow a simulated career,” according to Joshua Brustein of the N. Y. TIMES. Players “will not control the dribbling and shooting, but instead build up -- or purchase -- attributes like speed and skill in order to compete against people in their network.” The game is “part of a wide-ranging social media campaign” by the NBA. With 2.2 million followers on Twitter and more than 7 million Facebook fans, the NBA “has a significantly larger presence than any other American sports league.” The NBA already has deals with Electronic Arts “to make console video games featuring its players and teams,” but league officials said that they “wanted to keep tighter control over NBA Legend, which they want to coordinate with other social media efforts.” Brustein noted NBA officials “chose to work with Lionside, the game developer who created the game, largely to maintain that control.” NBA Digital Senior VP & GM Brian Perez said that the league “sees NBA Legend as a way to keep fans engaged in basketball even when no games are being played.” It also “hopes to draw revenue by persuading fans to purchase virtual shoes, sports drinks and other products that they will use to improve the performance of their avatars.” The NBA is “looking to create deals with sponsors who will pay to market virtual items within the game,” though no such arrangements “will be ready when the game is introduced” (NYTIMES.com, 2/14).
The major sports unions will not argue today in front of the Ninth Circuit Court of Appeals on behalf of former college football QB Sam Keller in his lawsuit against Electronic Arts after their attorney suddenly pulled out of the case. The sports unions -- the NFLPA, MLBPA, NBPA, NHLPA and MLSPU -- had petitioned twice to argue on behalf of Keller, who is arguing EA used his image without his permission. The court agreed to give the unions, which had filed a friend of the court brief in November, five minutes. That time was to be taken out of Keller’s lawyers’ time. “This morning, Paul D. Clement of King & Spalding withdrew his appearance as co-counsel,” the unions wrote the court yesterday. “Regrettably, the Players Associations have been advised that Mr. Clement’s firm is unable to continue to represent them due to a late-discovered conflict.”
MARKETING magazine’s John Reynolds reports tennis player Andy Murray is “set to overhaul his portfolio of commercial partners, following the departure of long-standing sponsor Highland Spring.” Murray had been “sponsored by the Scottish water brand” since ‘06. A source said that Murray is “aiming to capitalise on his position as a top-five player in the world rankings with endorsements from bigger global brands.” Murray's current deals with adidas and racket supplier Head “are unaffected” (MARKETINGMAGAZINE.co.uk, 2/15).
PUSHING THE LIMIT: Manchester United looks “certain to be the first Premier League club to break” the £100M (US$161.2M) “barrier for commercial revenue alone.” The “most recent three-monthly accounts showed revenues rising” to US$38.7M over the first quarter of the accounting year (PA, 2/14). Meanwhile, Manchester United announced DHL will become the official logistics partner of the club in a three-year agreement. DHL will provide a range of logistics services to the team. The company will use the partnership in business-to-business and consumer marketing activities and will be featured in digital advertising boards, matchday programs, on Man U’s website and at selected events at Old Trafford. In addition, DHL will work with the Manchester United Foundation (Manchester United).
TIME TO CASH IN: CNBC's Darren Rovell said Packers QB Aaron Rodgers "has a chance to do one or two national deals" after winning Super Bowl XLV earlier this month. The win should make him "big enough for Nike, which has owned his marketing rights for shoe and apparel since his rookie season, to actually utilize him." Rovell: "What's interesting to me is Aaron Rodgers doesn't even have an official website. ... He wasn't on Twitter, he wasn't out there reaching out to fans, which is important" ("Morning Drive," Golf Channel, 2/14).
SCHOOL DAZE: The Sports Authority is the official sporting goods store of the Illinois High School Association, according to a new three-year deal the retailer signed with the IHSA. The agreement was executed by Cleveland-based agency Home Team Marketing, the rights holder for the Illinois state athletics group. As part of the deal, Sports Authority will have a presence at all IHSA-sanctioned sporting events with branding and on-site activation. The IHSA represents more than 750 public and private schools in Illinois, including the nation’s third-largest high school district, the Chicago Public Schools, and its events draw a cumulative audience of 2 million fans annually (Home Team Marketing).